The Malta Employers’ Association has said that a revision in the cost of living adjustment for 2011 is out of the question. It said this in response to a call by the Ghaqda Unions Maltin to revise COLA to anticipate inflationary pressures which are expected to occur during 2011.

The MEA said that companies are also hit hard by the increases in fuel prices, and that, besides COLA, employers are also facing higher social security contributions as part of the pension reform.

“Raising COLA at this stage will only create further inflationary pressures and will contribute towards a wage price spiral that will have a negative effect on the country’s competitiveness,” the MEA said.

The MEA also reminded unions that they were always inflexible whenever employers wanted to discuss a revision of the COLA mechanism.

“In fact, unions refused to discuss a revision in the COLA increase of €5.82 which was given in 2010, even though this could have resulted in job layoffs during a period of recession. The reason given by the unions at the time is that COLA is an agreement which was reached years ago and that employers are bound to honour that agreement,” it said.